09 February 2007
8 February 2007
Umbro increases stake in China joint venture to 40%
Umbro plc ("Umbro") today announces that it has reached an agreement with Win
Hanverky Group to purchase an additional 15% equity stake in its licensee for
Greater China, Team & Sports Ltd ("Team and Sports") and enter into a revised
distribution agreement. Umbro purchased an initial 25% equity stake in October
2005. The consideration of $16.5m is payable on completion which is expected
within the next 14 days.
The agreement increases Umbro's exposure to the rapidly growing Chinese market,
which has a population of over 1.3 billion and growth in GDP of 10.7% in 2006.
Team & Sports distributes Umbro branded sportswear, footwear, accessories and
sports equipment in the Peoples Republic of China, Hong Kong and Taiwan on an
exclusive basis. As at 31st December 2006 there were over 90 distributors
operating over 1,000 Umbro retail outlets in these territories.
Umbro has a longstanding relationship extending over 15 years with Team and
Sports. Umbro's partner in Team and Sports is the Hong Kong listed Win Hanverky
Group, which is an integrated sportswear, active and outer wear manufacturer and
distributor for various top-tier international sportswear brands.
Win Hanverky is a listed company in Hong Kong and in accordance with the rules
of the Hong Kong stock exchange, a circular containing full details of the
transaction will shortly be sent to Win Hanverky shareholders. This obligation
arises because Umbro is a connected party under Hong Kong stock exchange rules.
Umbro CEO Peter McGuigan, commented:
"This investment underlines our strategy to increase Umbro's exposure to growth
markets. The additional investment in Team & Sports strengthens our position as
a strategic partner in what is undoubtedly the most exciting market in the world
We have an excellent partner in Win Hanverky Group and together we are well
positioned for the future development of the Umbro brand in China."
Umbro is due to announce results for the year to December 2006 on 8th March
Sports in China:
• Annual expenditure on sporting goods is 0.2% of GDP compared to 1.0% to
1.5% for developed countries;
• China will hold the 2008 Olympics in Beijing, an event that is
anticipated to significantly increase sports participation and demand for
• In a recent study of interest in international football in China carried
out by Warwick Business School, England (whose kit sponsor is UMBRO) was
found to be the Chinese football fans favourite international team. The
England shirt was found to be the most popular football shirt across China.
Umbro sponsorship in China:
• China National Futsal Team
• 3 out of 6 China Futsal League Teams
• 2 Super League Teams : Changchun Yatai, Henan Construction
• Futsal League Title Sponsorship
• China population in excess of 1.3 billion;
• GDP growth 1994 to 2004 of 11.3% per annum;
• Chinese middle class anticipated to grow from 22% of households to 63%
of households by 2015 with commensurate share of disposable income
increasing from 40% to 66%; (National Bureau of Statistics; McKinsey Global
Umbro 0161 492 2000
Peter McGuigan, Chief Executive
Stephen Makin, Chief Financial Officer
Brunswick Group LLP 020 7404 5959
Simon Sporborg / Dominic McMullan
UMBRO is a global football brand. Based in the UK, where the UMBRO business was
founded in 1924, the Group designs, sources and markets football related
products which are sold in over 90 countries. UMBRO's product range comprises
apparel, footwear and equipment.
UMBRO's and its international licensees currently supply kit to national teams
and leading professional clubs worldwide, including England, Sweden, Republic of
Ireland, Norway, Olympique Lyonnais (France), FC Santos (Brazil), CSKA Moscow
(Russia), Everton (England), Glasgow Rangers (Scotland), Gamba Osaka (Japan) and
Bestiktas (Turkey). The UMBRO brand is also endorsed by high profile individual
players including the England Captain John Terry, Michael Owen, Deco, Luis
Garcia, and Tim Cahill.
About Team and Sports
Team and Sports is the licensee responsible for the distribution of Umbro
products in China, Hong Kong, Taiwan and Macau. In the audited accounts for the
year ended 31st December 2005, Team and Sports recorded turnover of
HK$338,770,700 and net profit after tax of HK$40,601,722.
This information is provided by RNS
The company news service from the London Stock Exchange